Work-rules verdict jars with laws aimed at leveling playing field for employees

We live our lives bound by rules. As a student, my teachers scolded me to comply with school regulations, which were Draconian by modern standards: “Skirt hems must reach down to within 5 cm above the knees,” “Boys must shave their heads” and other meaninglessly strict school regulations were the rule rather than the exception.

As adults, are we free from oppressive rules? Far from it. While protecting our rights, laws also restrict our freedoms in myriad ways. Let’s look at those that affect our workplace — so-called shū gyō kisoku work rules.

Shū gyō kisoku stipulate regulations for the workplace and working conditions, such as wages and work hours. Labor Standards Law Article 89 states that employers with 10 or more regular employees must draw up shū gyō kisoku. These must include start and end times, off days, wages, resignation and dismissal conditions, as well as severance allowance, sanctions and leave requirements, if such things exist.

Shū gyō kisoku affect work conditions on a daily basis. Although drafted by the employer, employees must be given the opportunity to give their opinion about the rules or changes to the rules in writing (Article 90) through a representative of their choosing. Worker consent, however, is not required.

Problems arise when employers ram through degradations to working conditions. The Supreme Court released a controversial verdict on this issue on Dec. 26, 1968, in the Shuhoku Bus case.

Mr. X had been working for 12 years at this company when management unilaterally changed the shū gyō kisoku to set the retirement age at 55. He was already 55 at the time, however, so the company handed him a cardboard box and told him to get packing.

The court ruled that “In principle, employers cannot unilaterally worsen the conditions or deprive the rights of workers through the creation or change of shū gyō kisoku, but each individual cannot refuse application of new terms just because he or she does not consent, as long as the new terms are rational and logical.” Mr. X lost the case, and this verdict has stayed on the books for more than four decades as a centerpiece of labor law jurisprudence, finally finding its way in 2007 into Article 7 of the newly enacted Labor Contract Law.

It is hard to accept such an arbitrary definition for valid changes to work rules. All it need be is “rational and logical,” according to subjective assessment — that of a judge, at the end of the day. It also seems to contradict Article 2 of the Labor Standards Law, which says, “Working conditions should be determined between the employee and employer from a position of equality.”

Article 2 was created specifically to address the dramatic power imbalance that exists between employers, who can freely choose which employees to hire, and employees, who must work just to make a living. Japan’s labor law aims to create some form of power parity by limiting the authority of employers, because without any restriction, working conditions will obviously just snowball downhill. That notion of redressing the balance is behind Article 2, as well as much of the Trade Union Law.

So, despite all of this, Article 7 of the 2007 Labor Contract Law suggests employers can draft shū gyō kisoku unilaterally and thereby worsen conditions. This would seem to contradict the parity provision of Article 2, but what do readers think?

Hifumi Okunuki teaches constitutional and labor law at Daito Bunka University and Jissen Women’s University, among others. She also serves as paralegal for Zenkoku Ippan Tokyo General Union. On the third Tuesday of each month, Hifumi looks at a famous case in Japan’s legal history to illustrate an important principle in labor law. Comments: community@japantimes.co.jp